PowerPoint seems to cause the problem, but it is really video card settings that make your movie playback at full screen.
(on pre-Vista OS) go to START >> DISPLAYS >> SETTINGS tab >> ADVANCED button >> depending on graphics card find the settings for THEATER MODE (usually buried a few buttons down). If it says play movies full screen, that is what PowerPoint looks at and does… I recomend changing THEATER MODE to ‘standard’ so there are no surprises.
– Troy @ TLC